Real Estate

Vancouver housing bubble?

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Feb 15, 2008
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Rickson9 wrote: Let's not forget the present...

"Prices are still going up" - The market
Not in most of Canada anymore.
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Feb 15, 2013
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Mark77 wrote: Not in most of Canada anymore.
How are you doing with finding sources for that opinion? Did you put it in another thread perchance?
Rickson9 wrote: Actually your post said:
You said I've provided. You haven't. The original quote still holds true. That is:
^ This.
"Prices are still going up." - the Market
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Aug 23, 2007
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Forget about it - he's too busy trying to edit the definition of subprime mortgages on Wikipedia without getting caught.
Penalty Box
Apr 16, 2012
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Greely
lol Mark77, if you are up 35% on your $1mil portfolio, which is $350K, that should be more than enough to purchase a house and live your life...employed or not.
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May 1, 2012
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Mark77 wrote: Not in most of Canada anymore.
Considering that we just saw a 11.3% price hike in the GTA.... and the fact that he has yet to show one single proof.... well... get a job. You are spending way too much time online.
Sr. Member
May 26, 2010
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Anikiri wrote: I am not really here for my thoughts. I am here for facts. But I'll oblige. Furthermore, I'll also put a few numbers out.

- 49% of homes that cost at least 1 million are purchased by foreigners in Montreal
- 25% of such homes in Toronto are foreign owners
- 40% in Vancouver
Those numbers are crazy for Vancouver and Montreal (Vancouver moreso, as many of the regular detached home, as you mention, is easily pushing a million dollars, where I presume Montreal you get more of a luxury house for that money).

I would note though, that the Vancouver sample does look pretty small however at 1,239 according to the FP. It should also be noted that this report is from a real estate firm, and doesn't disclose the raw data in it's report, nor the agents that they were working with to determine the buyer origins - although even if the figure for Vancouver was 20% foreign buyers, I'd be surprised. There does also seem to be scant definition of a "foreign buyer". As someone who lives and works in Vancouver buy only came to the country 4 years ago, I'm sure I could be loosely defined as a "foreign buyer". They don't mention whether that term is aimed at non-residents of Canada, non-permanant residents of Canada or non-citizens of Canada (if it is non-citizens then I find the number a lot more believable).
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Dec 27, 2006
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Anikiri wrote: I am not really here for my thoughts. I am here for facts. But I'll oblige. Furthermore, I'll also put a few numbers out.

- 49% of homes that cost at least 1 million are purchased by foreigners in Montreal
- 25% of such homes in Toronto are foreign owners
- 40% in Vancouver

These are expensive houses. They are not the fixer uppers by any stretch. Then again, how hard is it to find a detached in Vancouver for over 1 million?

As for your questions.

1) Locals are being priced out already. How many people that frequent here aren't buying because they simply cannot afford it? How many that voice their concerns are complaining that they are forced to buy in Brampton or Orangeville... because housing in Toronto is too expensive. Leading up to 2016, there will be echo boomers buying into the market. Do you know what will happen to the real estate market? It will go up up and up.

2) I believe if you dig back a few posts about housing bubbles in Canada, you'll notice the recent (couple years) shift in mortgage pullback, tightened lending restrictions, and increased cash purchases. I am not going to dig it all up, it was all presented already by other users. I am sure you have read them. What you are referring to as a record amount of mortgage debt is really just locals trying to keep up with the market. At some point, you're going to be out.

3) If the cmhc stopped backstopping mortgages, you'll again see a temporary blip like last year... then straight back up. As evidence from the last several rounds of lending restrictions, people simply find ways around it and purchase slightly later. Also, seriously you think the cmhc is going to stop backing mortgages? I am not even going to ask why you raise such a ... questionable question.

4) The Canadian economy has very little to do with housing prices. Think about the new Toronto average housing prices increase of 11.3% over last year. When was the last time you got a 11.3% raise? Housing prices are dictated by many factors:
- immigration
- social mobility, global trend of people moving into metropolitan areas
- foreign ownership
- record low interest rates
- extremely low inflation... even... possibly deflation (see most recent BoC - today - statement)
- so on and so on.

I am tired of answering your questions. But basically it boils to that wages have not kept up, but like I said it's not the locals that are dictating the housing trend. One of the big reasons locals are even in the market is due to their parents backstopping. Wages have not kept up.

It really boils down to this. If you compare the Toronto housing market to many of the biggest and wonderful cities in the world, Toronto has yet a lot to climb. It's really sad, but this can go on for a long time. If you are such a big real estate bear... why don't you bet against the market?

People raise the same questions you've raised every freaking year. Have you seen the housing price index (historic) of Toronto? How many times were you right? ... a better question is... even when you were right... how long were you right for? a couple years? Then it's right back to record numbers.
The answers you've provided speak volumes.

Thank you.
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Motoss wrote: The answers you've provided speak volumes.
Thank you.
Except that there's little evidence to back up his claims.

He implores RE bears to "best against the market". Yet, short of not owning a house, I'm not sure how you can really short sell a house. I guess you could buy bank stock and benefit from a housing fall, but that's hardly a perfect hedge.

He claims that reducing the CMHC backstop would be of minimal impact, yet when the CMHC put the brakes on, it was a major inflection point in the market, with most people who actually study the numbers agreeing that house prices are now *falling* in most of Canada including the GTA (sales numbers might still rise, but that's more of an artifact of the sales mix, not of "identical properties" rising).

The claim that foreigners are bringing lots of money to Canada and buying doesn't stand up to scrutiny either. After all, foreign buying would imply a reduction of leverage, a reduction of credit. This isn't happening as we can see from the stats that come out.

Stats Can tells us that Canada runs a positive balance of international payments, money is generally leaving Canada (ie: more money is flowing out of Canada than is flowing into Canada!):

http://www.statcan.gc.ca/tables-tableau ... 1a-eng.htm

Of course, the RE pumpers would have us believe that there's huge sums of foreign cash coming to Canada, but the facts run quite the opposite of such. That's why they shouldn't be taken seriously. The RE pumpers don't seem to have a credible explanation for all the leverage, and they claim that Canadians will be perpetually priced out of Canadian property. Even though, we've had various bubbles throughout the existence of Canada, yet life goes on when they pop. Railway bubbles. Bond bubbles. Tech bubbles. Oil and gas bubbles. Mining bubbles. Housing bubbles. Electricity bubbles. They all have collapsed, albeit the legacy they leave, of low-cost production, raises the standard of living for Canadians.
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...
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Mark77 wrote: Except that there's little evidence to back up his claims.
Was that an attempt at irony?
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Rickson9 wrote: Was that an attempt at irony?
Nope. Come on, as someone involved in sales yourself and trained as an engineer, you should know that a changing sales mix can certainly affect the average quite significantly. Until the RE boards start publishing more thorough descriptive statistics, their credibility in claiming large increases is highly questionable.

PF4RedFlag published a lot of data in this area. It clearly showed the low end dropping off quite substantially in the GTA. Sales volume increases could very well be attributable to a sort of panic. Again, nothing that wasn't seen in the US particularly in the 2006-2008 period. Some markets just melted slower than others, but the rot generally started at the bottom and coincided with subprime credit drying up/becoming significantly restricted. Just as we now see in Canada with CMHC pulling back on subprime guarantees.
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...
Penalty Box
Apr 16, 2012
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Greely
Mark77 if you are up 35% YoY with your $1mil portfolio of XIU stocks, thus have $1.35 mil, why not just go do whatever you want to do?

That is unless you want to be a professional forum complainer?
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http://www.statcan.gc.ca/tables-tableau ... 08-eng.htm

Interesting chart. Note that foreign investment in Canada only increased $34B YoY. Canadians increased foreign investment outside of Canada by roughly $35B. So fairly equal.

Foreigners have snapped up Canadian bonds, to the tune of around a $59B increase YoY. This is what finances Canada's debt/leverage bubble. Not really direct ownership of Canadian RE. After all, our net investment deficit position only increased by around $75B.
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...
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techcrium wrote: Mark77 if you are up 35% YoY with your $1mil portfolio of XIU stocks, thus have $1.35 mil, why not just go do whatever you want to do?
I don't have a net worth of $1M. I have a portfolio in that range. I've made no secret of being leveraged, although nowhere near as aggressively as a certain poster would suggest.

Discussing what's going on in the RE market is not 'complaining'. Discussing the state of other things, such as Canada's anemic labour market is not complaining. Its merely a discussion of facts (or otherwise, depending on what your particular view is...).

On that note, the BoC made a decision today, and apparently the media is now solidly interpreting such as a prelude to a rate cut. I predicted this, much to the chagrin of a certain poster, a good year or two ago. As RE deflation continues in Canada.
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...
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techcrium wrote: Mark77 if you are up 35% YoY with your $1mil portfolio of XIU stocks, thus have $1.35 mil, why not just go do whatever you want to do?

That is unless you want to be a professional forum complainer?
Don't forget the $70Gs of "tax burden" he allegedly pays per year.

We all know at face value he is full of it. The numbers are right there in front of us and there is no way he could achieve 35% YoY with XIU.TO and Barrick Corp.

But you know whats nutty about the whole thing? It goes back to his warped view of reality. I think, he thinks the profit made by the companies "he owns" are part of his calculation.

So if he was a 1% shareholder of ABC Corp, which made $100 a year in corporate profits, he will consider $1 to be his own personal profits. Even though ABC Corp may only pay out $0.01 in dividend for each 1% owner. So his profit to him is not the dividends he received, but the total including corporate profits at the corporate level. His profits become $1.01 in his eyes.

This is the sort of insanity he was arguing about earlier about paying taxes. He also considers corporate taxes, paid by the corporation directly to the CRA, to be included in his own taxes. So, whenever M77 says he 'paid so much taxes', take what he says with a grain of salt. Its all crazy talk because nobody talks or thinks like that. He merges his own finances with the company's books.

But to end this all, we all know at the end of the day, he just makes up numbers out of thin air. I dont even think he calculated anything. He just chooses numbers he likes and says it.

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